Landlords and developers winners from PM's state home sell-off

Prime Minister John Key’s fire-sale of state homes will line the pockets of landlords and property developers and drive up rents, while offering less security for New Zealand’s most vulnerable families, the Green Party says.


“John Key’s speech on the future of so called “social housing” today was a pie in the sky wish list of maybes, that didn’t show a coherent plan for the building of a single new home, ” Green Party Co-leader Metiria Turei said.


“John Key is skirting around the simple truth - selling thousands of state homes will never lead to more people being housed unless more homes are being built to replace them - and I don’t see a concrete plan to make that happen.


“What John Key did say today is he’d like to sell off entire suburbs of state homes to property developers, with no absolute guarantee that those individual developers will have to provide any space for community housing in the future.


“These homes are a huge national asset that was built up over time by generations of New Zealanders who believed that everyone had the right to live in a good quality home.

"Now the Government wants to sell our state homes and plough the capital raised into other areas of it's books. That's a loss we will never recover.

“John Key’s plan amounts to a major transfer of wealth: New Zealanders give away our state homes at bargain basement rates, developers make a healthy profit and landlords get rich from increased rent subsidies. This harks back to the 1990s, when the accommodation supplement was supposed to be the solution to helping lower income New Zealanders afford a decent home, but ended up going straight into the pockets of landlords. But this time, we lose our state homes as well.


“The fact is, New Zealand desperately needs more affordable homes and better services to house the vulnerable, and the best way to build affordable houses is for the Government to step up and do it. Government can borrow cheaply and achieve significant economies of scale, without having to make a profit off the build. But National is ideologically allergic to the state owning homes, and will sell up, regardless of the consequences.


“The Government’s strategy of using property developers to build affordable houses is economically flawed. They will build in profit margins, and aren’t generally interested in building low cost houses unless they can make a mint out of it.” Mrs Turei said.